1. Labour Supply & Demand Projections Model
Canadian Tourism Human Resource Council
Labour Supply & Demand Projections Model
FLMM LMI Working Group
Vancouver, BC
October 18, 2007

2. The Background Historically COPS basis for demand growth rates
Applied formula to COPS to get growth rates for tourism NAICS
Needed to better understand current and projected labour supply/demand gap
No existing supply data available
Tried to create own supply data but not comparable to demand data

3. Requirements of the Model
Supply and demand data must be comparable
National, provincial and potentially regional data
Model needs to be responsive, flexible and timely
Representative of what industry is feeling
Ideally able to compare data to other sectors

4. Approach
Based on the Construction Sector Council (CSC) model (Macroeconomic model & Industry input)
Industry input collected through two sets of 10 focus groups (1/province), on-line survey, in-depth interviews
Use of existing economic indicators, labour force information from established data sources (i.e. NTI, TSA HRM)

5. Selected Providers
The Conference Board of Canada’s Canadian Tourism Research Institute (CTRI) was chosen through RFP process to develop the model using macroeconomic indicators and focus group input
Expertise in tourism economic indicators
Experience building economic models
Access to CBoC labour economics data
Omnifacts Bristol Group selected to facilitate focus groups
Experience working in tourism
Expertise in focus group facilitation

6. Timeline Summary Initial model development March/April 07
Focus groups May/June 07
On-line survey/interviews May – Sept 07
Focus groups (validate results) Oct/Nov 07
Final delivery of model Mar 08

7. Preliminary Results
Tourism Labour Supply and Demand Gap

8. Model Details
(Tourism/non-tourism) demand projections for tourism goods and services
Forecasts of domestic and foreign tourism demand by NTI category developed using our tourism models
Provincial distribution of tourism demand based on 1998 PTSA and grown out using our tourism models (constrained by national)
Forecast of non-tourism demand driven by CBoC model forecasts
Provincial distribution of non-tourism demand also based on 1998 PTSA and grown out using CBoC models (constrained by national)

9. Model Details
Labour demand generated by demand for tourism goods and services - National
HRM provides details (gender, age, immigrant status) for 5 industry groups, and 37 distinct tourism sector occupations for 2005
Linked to overall sector (tourism/non-tourism) revenue, in TSA/NTI framework, through implicit productivity measures for 2005
Productivity assumptions going forward based on historical trends and relationship with overall economy

10. Model Details
Labour demand generated by demand for tourism goods and services - Provincial
Provincial employment shares from custom LFS tabulation (2005) applied to 2005 HRM to establish constraints for overall province and at industry level
Fixed occupational breakdown within industry to national
Establish link to estimated sector revenue (tourism/non-tourism) in TSA/NTI framework, through implicit productivity measures for 2005
Productivity assumptions going forward also based on historical trends and relationship with overall economy

11. Model Details Labour shortage projections in tourism sector
Shortage calculated as labour demand minus labour supply
Approach suggests gap of 0 in 2005
Refined approach implies that gap may not be 0 in 2005
Go back to establish benchmark either based on a stable period of growth (late 1990’s) or recent period when labour shortages not likely to exist (2003)
Our choice was to use to 2003

12. Next Steps - Modelling Integrate “levers” for health/retirement age
Boost demand for leisure/business travel and supply
Integrate “levers” for seniors income
Boost leisure demand
Integrate “levers” for part. rates (seniors/immigrants)
Boost supply
Integrate “levers” for in/out seasonal migration
Refine supply (regional fine-tuning and possibly reduce supply)

13. Next Steps – Modelling Develop market interaction model
Integrate capacity constraints (developments that don’t take place due to growing challenge of staffing)
Effects of real (and relative) wage changes
Relative wages increase, supply increases
However, demand also declines due to higher costs, poor customer service due to labour shortage
Smaller gaps as a result
Ultimately, the model will determine where the sector is likely to operate at (lost output)

14. Next Steps Analyze results Make improvements where needed
Run on a yearly basis
Expand to sub-provincial level (metro areas, resorts)
Compare demand to COPS demand

15. Thank you! www.cthrc.ca www.emerit.ca